Oregon's new wine country looks a little different: gritty industrial spaces, uncommon grape varieties, and not a vine in sight. Best of all? It's right down the street.

Nic Donahue outside of Alchemy Wine Productions, the Southeast Portland winery and tasting bar he runs with his wife, Gracey

Turn off SE Powell Boulevard at 20th Avenue and hang a right just before the Swag Northwest store. Ignore the screaming yellow “No Outlet” signs. Drive past a neat row of tiny houses until you hit a squat, olive-green concrete building marked “Industrial Studios.” Park and look for the sandwich board that reads “Alchemy.” Welcome to...wine country?

At Alchemy Wine Productions’ folksy tasting bar, Nic Donahue—owner, winemaker, tasting room manager, and lone salesman—pours glasses for two elegantly dressed women, one in a black shift and pearl necklace, the other in a neat pantsuit. One is from Vancouver, Washington; she’s treating her friend from Charleston, South Carolina, to a taste of Portland. The sweatshirted Donahue, tall with a playful smile, enthusiastically describes what they’re drinking: a tasty Syrah grown in Southern Oregon, where the grape fits the sunny climate “like a tailored shirt.” The wine is soft and round in the mouth, but with a bright tartness and the signature layer of freshly ground black pepper that’s typical to Syrah. The grapes, Donahue explains, came to Portland fresh off the vine in “Ol’ Betsy” (his ’68 Chevy pickup); he crushed, fermented, and bottled them in this building.

“You should be here at harvest,” Donahue says with a grin. “It’s crazy fun.”

Scattered amid barbed-wire fencing and small industrial business parks, nestled within repurposed buildings throughout the city, a new species of winery is sprouting. There are no vineyards here—no rolling green hillsides or sweeping valley views. Yet Portland’s urban center is fast becoming a wine destination as alluring as the classic rural setting, as an emerging generation of grassroots entrepreneurial winemakers like Donahue has taken root within the city, crafting top-notch wines and experimenting with new business models that fit their unconventional geography.

No one thinks twice about breweries in the city; no one expects to find them only in wheat fields or on hop farms. It can be surprising, however, to find wineries—with their romanticized rural connection to land and terroir—detached from vineyards. But the truth is, beyond knowledge and talent, vintners require only two things: a source of good grapes and enough space to turn them into wine.

Portland is home to 14 urban wineries, eight of which have opened in the past four years, from tiny garage operations and stylish collectives to chic wine bars with monthly cheese clubs. Seattle is the only American metropolis with more wineries in the city.

“I moved to Portland to open an urban winery,” says Donahue, who helped open two city-center wineries in Santa Barbara before launching Alchemy with his wife, Gracey. “I saw this wonderful opportunity here. There’s a huge economy of people who enjoy drinking, I can afford the space without going into debt, and Portland has proximity to world-class grapes.”

Nic and Gracey Donahue (with their son, Ely) crush, ferment, and bottle their Rhône-style wines in a quirky industrial warehouse.

In many ways, urban vintners like Donahue are attitudinal descendants of Oregon’s founding generation of modern winemakers. In the 1960s and ’70s, ambitious young entrepreneurs like David Lett and Dick Ponzi came to the then-off-the-grid state to build wine businesses that gave them an enhanced, values-based quality of life. As Oregon’s wine industry has grown over the past 50 years, however, so have the barriers to entry. “There are few routes into the wine industry for those without a huge bankroll,” observes Adelsheim Vineyard’s David Adelsheim, one of the state’s founding (and still most influential) winemakers. “One way, potentially, is via an urban winery.” And so in a reversal of the previous generation’s flight to the land, today’s young winemakers are finding the quality of work and life they seek by reclaiming underloved spaces within the city.

“This is my community, this is where I feel at home,” says Anne Hubatch, who worked with industry veteran Joe Dobbes before becoming head winemaker at Apolloni Vineyards outside of Forest Grove, and whose one-person operation, Helioterra, is now based at the Southeast Wine Collective, just off of SE Division Street. “The fact that I am seven minutes door-to-door between the winery and my home is fantastic. It allows my life to be what I want it to be.”

Similar motivations drove Portland’s earliest modern urban “winetrepreneurs,” Laurie Lewis and Renee Neely. In 2001, Lewis and Neely opened Hip Chicks Do Wine in a gritty Brooklyn-area warehouse with metal fabricators and trucking companies as neighbors. “Back then, there weren’t very many small wineries anywhere like us,” remembers Lewis, who commuted from North Portland to her job at the Duck Pond Cellars tasting room in Dundee for four years before launching Hip Chicks. “It was hard to convince growers to sell us only three tons of grapes, because that’s all we could handle—and then we had to convince them to drive the grapes into Southeast Portland.”

On a summery Wednesday evening at the Southeast Wine Collective, just blocks from buzzy restaurants like Ava Gene’s and Pok Pok, the garage door stands open. Passersby steal glimpses of Little Bird chef Erik Van Kley cooking for the collective’s monthly supper club as guests sip house-made wine and settle in at the long, candlelit dinner table in the middle of the concrete-floored space. When the fall harvest arrives in late September, this makeshift dining room will serve as the winery’s grape- and stem-strewn production area.

The Vincent 2012 pinot noir, with its lively, lip-smacking tartness and satisfying, cherry pie–like fruitiness, was made here by Vincent Fritzsche. Fritzsche spent four years fermenting wine in his garage, blogging about what he learned, and inviting people to taste. When local shops and restaurants began to clamor for his bottles, he decided to go commercial—while keeping his day job as director of professional development at Marylhurst University.

Fritzsche’s winemaking goal is straight out of the old Oregon wine playbook: he wants to make pinot noir that speaks of the place where it was grown. So why doesn’t he make his wine where the vineyards are? Fritzsche puts it plainly: “I don’t have the money to just go buy land and build a winery.” Plus, it wouldn’t feel right. “I’m a city person,” he says. “I’m married, we have kids. I wasn’t just going to move down to Dundee and be another guy on the hilltop—that’s not me.”

So, like four other urban winemakers, Fritzsche rents space at the collective. He gets to share high-cost equipment, trade winemaking knowledge with his colleagues, and participate in joint winemaker dinners and tasting events, all while still making his own wine, his own way. Plus, Fritzsche believes it’s just plain “smart business” to make his wine in the city where his customers are.

Thomas and Kate Monroe of Division Winemaking Company opened the Southeast Wine Collective in 2012; planning their winery as a communal business gave them the cash flow they needed. “I won’t say it took no capital,” Thomas says, “but the level of capital involved here compared to a fully built-out winery in the Willamette Valley is fractional.”

Vineyard land in the Willamette Valley can run between $20,000 and $40,000 per acre. Planting and farming costs can easily triple the investment; then add around $500,000 for a fully equipped and staffed winery building. By comparison, renting—or even buying—warehouse or commercial space in the city for $3,000 or $4,000 a month is an appealing option.

It turns out it’s also a strategic one. When winemaking veterans Stewart and Athena Boedecker left Carlton for Portland’s Northwest industrial district in 2003, they made 400 cases of pinot noir their first season and hoped they might grow to 2,000 cases. Last year, Boedecker Cellars produced 8,500 cases. Likewise, SE Stark Street’s ENSO Winery has been open only since 2011, but owner Ryan Sharp has already had to expand his winemaking capacity to meet demand. On NE Sandy Boulevard, the Bindery just opened the first subterranean winery and tasting room in the nation. And after just over a year in business, Southeast Wine Collective’s Thomas Monroe says, “I wouldn’t be surprised if we do another one of these—and maybe at a different scale.”

Anyone who wonders whether a city winery can be a serious winery can simply taste the wines: Boedecker’s Shea Vineyards pinot noir is the epitome of elegance; ENSO’s Resonate #8 is beautifully fruity; Helioterra’s mourvèdre is luscious, lovely, and may be the best expression of that grape from the Northwest; Clay Pigeon Winery’s pinot noir is trademark Willamette Valley fruit, full of black cherry, earth, and dried herb notes.

Will the city’s wine scene ever rival the valley’s? David Adelsheim is doubtful. “Wine lovers still want to see vineyards and touch vines, not just see tanks and touch barrels,” he says. “The best wines are about place, and place is where the grapes grow, not where the wine is made.” Urban wineries, he says, aren’t the future of the wine industry—but they are “an interesting alternative.”

Perhaps an alternative is exactly what Oregon’s wine industry needs to attract new consumers. Only two urban wineries specialize in Oregon’s pinot noir grape (Boedecker and Vincent)—the rest are spreading their efforts to include grape varieties less common for the state, including mourvèdre, viognier, and melon de Bourgogne.

At places like Alchemy, you can taste the revolution in the making: “In Oregon, I feel like the opportunity to put up a flag is still here,” Donahue says, pouring another glass for his two visitors. “I think I can make world-class wines...right here in Portland.”

Michael Claypool and Sasha Davies moved to Portland in 2008 to make wine and sell cheese. Claypool had experience as a wine retailer and sommelier in New York, as well as winemaking in Sonoma, while Davies is a cheesemonger, author, and general fromage guru. They thought they’d move to wine country, but found the allure of the city too strong. Instead, they opened a combination winery, restaurant, and cheese shop just blocks off of E Burnside Street.

Insider Intel: Come for the wine, but stay for the cheese. Davies’s cheese club is extraordinary, and the restaurant side of the operation is a full-on wine bar serving lunch, dinner, charcuterie, and cheese plates.

Calling herself a “gypsy winemaker,” Anne Hubatch gained experience working as an assistant for Joe Dobbes before becoming head winemaker at Apolloni Vineyards and then going solo with her own Helioterra brand. She worked on the first vintage at the Carlton Winemakers Studio, and now produces her wines at the Southeast Wine Collective.

Insider Intel: Hubatch’s strongest point is her white wines—especially the pinot blanc. Her pinot noirs are quite good, but the mourvèdre is one of the best in the Northwest.

After helping open urban wineries in Santa Barbara, California, Nic and Gracey Donahue moved to Portland to open their own—and to bring their love of Rhône varieties to the Northwest. Nic says he relishes being a “Rhône to the bone” underdog in Oregon’s “pinot-land,” happily sourcing warmer-climate grapes from Southern Oregon and occasionally Washington.

Insider Intel: The Class Act pinot noir is a steal—and a portion of the proceeds are donated to educational nonprofit Stand for Children. But the bottom line: Nic loves Syrah. He’s eagerly on the lookout for cool-climate Willamette Valley fruit to make a Northern Rhône–style Oregon Syrah.

One of the few urban winemakers who is unabashedly pinot-centric, Vincent Fritzsche works with grapes he sources from individual vineyards in specific parts of the Willamette Valley. That way, he can make terroir-driven wines that vary by region.

Insider Intel: Get a glimpse of winemaking on Fritzsche’s blog, elevage.blogspot.com, before tasting his wines at the Southeast Wine Collective.

When Stewart and Athena Boedecker made their first vintage at the Carlton Winemakers Studio, they scored immediate hits. “When we got big enough to build our own place,” Stewart recalls, “we had to step back and take a look at what we wanted to do and where we wanted to live.” Or, as Athena puts it, “Let’s just listen to what our gut says.” And so they moved to the city.

Insider Intel: The Boedeckers’ Stewart pinot noir is more feminine, with elegant, refined, red fruit–toned flavors, while the Athena blend is darker, earthier, and more robust.